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Business review<br />
Management <strong>report</strong><br />
Nitrogen<br />
Nitrogen is essential for the development and growth of<br />
plants and is particularly crucial for growth, colour and yield.<br />
36 EuroChem Annual Report and Accounts <strong>2011</strong><br />
In Nitrogen, our vertical integration starts with<br />
natural gas. Located in Russia’s gas-rich<br />
Yamal region, our natural gas assets have the<br />
capacity to produce 1.1bn m 3 of natural gas<br />
per year, enough to cover 25% of our current<br />
needs. As the differential between Russian<br />
and European gas prices continues to narrow,<br />
having our own natural gas production serves<br />
to further support our competitiveness.<br />
Natural gas is synthesized with steam and air<br />
to produce ammonia. As the basic raw<br />
material for all nitrogen fertilizers, ammonia<br />
can then be applied directly to the soil but, for<br />
a number of reasons, including environmental<br />
concerns, it is generally processed further.<br />
The most important nitrogen fertilizers in our<br />
product offering are urea, ammonium nitrate,<br />
urea ammonium nitrate solution (UAN), and<br />
calcium ammonium nitrate (CAN).<br />
51%<br />
of EBITDA contribution<br />
to the Group<br />
in <strong>2011</strong><br />
While some plants are able to capture (fix)<br />
nitrogen from the air, most take it through the<br />
soil via their root system. Nitrogen fertilizers<br />
must be applied <strong>annual</strong>ly as the soil’s nutrient<br />
value is either consumed by plants or subject<br />
to leaching and wind erosion. In turn, this<br />
makes demand for nitrogen fertilizers the<br />
most stable of the three nutrients.
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